Quade Cooper has confirmed he has ended a six-month standoff with the Australian Rugby Union (ARU) and signed a two-year deal reportedly worth $800,000 a season.

The Wallabies five-eighth committed to a new three-year deal with the Queensland Reds back in June but that was dependent on him signing with the ARU.

Talks with the ARU were on the brink of collapse late last month when it offered him a new incentive-based deal.

Cooper's criticism of the Wallabies' "toxic" culture is believed to have initially resulted in a downgraded offer but after going back to the negotiating table he and the ARU have reached agreement.

"It's a very happy moment, to be able to continue my career with the Reds and hopefully the Wallabies is pretty exciting," he said.

"Reds chairman Rod McCall, (director of coaching) Ewen (McKenzie) and (Reds CEO) Jim Carmichael have worked very hard with (ARU CEO) Michael Hawker behind the scenes and were able to get a deal done.

"Now I can concentrate on my footy career and my upcoming boxing fight."

Asked how close he was to walking away from Australian rugby, Cooper said: "It wasn't a matter of walking away.

"I expressed my desire to continue to play rugby but there was no contract at that stage so I had to continue on and deal with what I had.

"So last week I held a press conference to announce that fight to make sure I had something there.

Cooper's decision to turn down a massive offer from France suggests he either believes he can still work with Robbie Deans or the Wallabies coach's days are numbered.

On the French offer, Cooper said: "I have never said anything about a French offer.

"I could have brought that up at my last press conference but we didn't.

"It wasn't a matter of playing people off each other.

"It was just a team over in France had expressed great interest and I am very grateful for that.

"My first goal now is to get back out on the paddock and do my best for Queensland."

After the A$800,000 per season offer that was withdrawn after his criticism of the state of the game and the atmosphere in the Wallabies' camp, the 23-year-old playmaker considered playing in France next year.

It is understood the offer from France that would have made him one of the highest paid players in the world.

However, Cooper made it clear at a press conference in Brisbane last week to announce he was fighting on the undercard of Sonny Bill Williams's February 8 bout against Francois Botha, he did not want to leave the Reds.

Queensland chairman Jim Carmichael was desperate not to lose Cooper either, and he has been working behind the scenes to convince the ARU to make the 38-Test star an offer he would accept.

The new deal represents a massive backflip by the ARU after Cooper was made to feel he was effectively being forced from the game.

He said at his press conference with Williams he had rejected the offer on the table, while his manager, Khoder Nasser, blamed the ARU for a ''total communication breakdown''.

Officials have also been suggesting to Cooper his mentor at the Reds, Ewen McKenzie, will replace Deans as Wallabies coach and would want him to call the shots for the Test team the way he did in Queensland's 2011 Super Rugby premiership-winning season.

With Cooper in the No 10 jersey, the Reds have won 87 per cent of their matches but that ratio drops to just 50 per cent when he doesn't play.

Cooper's re-signing should ensure a capacity crowd for the Reds' first home match on February 23 against the Waratahs, who will feature former Queensland State of Origin star Israel Folau.

It was Cooper's criticism of the Wallabies' ''toxic'' culture and the state of the code that resulted in the downgraded offer after he failed to sign a more significant deal tabled mid-year.